Pioneer testing “upper” Eagle Ford

It’s not enough to try to keep track of the oil, condensate and natural gas drilling windows in the Eagle Ford Shale. Now the Irving-based Pioneer Natural Resources is among the companies talking about drilling the “upper” and “lower” portions of the formation.

In its third-quarter call with analysts, Pioneer said it has drilled an “interesting” well in the upper (more shallow) part of the Eagle Ford with an initial production rate of more than 1,600 barrels of oil equivalent per day.

That success is likely to add drilling locations in Karnes and DeWitt counties, the company said.

(Much of the Eagle Ford drilling by Pioneer and other companies has focused on the lower, deeper part of the formation, which is closer to the Buda Limestone).

Analyst Brian Corales of Howard Weil Incorporated asked if the “upper” Eagle Ford was really the Eagle Ford, or if the company was likely to get some production from the nearby Austin Chalk, a conventional reservoir.

Timothy Dove, president, COO and director, said that as the wells get closer to the top of the Eagle Ford, it’s possible that the Austin Chalk could contribute to production.

The company said it has had some production delays in the Eagle Ford in the third quarter due to pad drilling and a technique called the “zipper frac,” where multiple wells are fractured at the same time, but that production is picking up “significantly” in the fourth quarter.

Pioneer is also dropping the spacing between its wells, and has tested moving from 120-acre spacing (about 1,000 feet apart) to 60-acre spacing (about 500 feet apart). Now it’s looking at 30- to 40-acre spacing.

Pioneer says the downspacing of the wells means a 20 percent increase in the company’s estimated ultimate recovery in the Eagle Ford.

And Pioneer is among the companies using sand – lots and lots of sand. “The longer laterals, the more sand you put in, the increase in production and an increase in reserves follows,” Scott Sheffield, chairman and CEO said in the November call with analysts.

You can find the full call with analysts at SeekingAlpha, which has free registration.